Electronics and semiconductors manufacturing in Vietnam for foreign investors.

Electronics and semiconductor manufacturing has become one of Vietnam’s most important growth sectors, and the country is now positioning itself as an alternative semiconductor supply chain hub in Asia. For foreign investors, the opportunity comes with a detailed set of incentives and compliance requirements that shape how and where to set up.

This guide outlines how Vietnam’s electronics and semiconductor industry has developed and where it sits in the regional supply chain. It also covers the regulatory, compliance and tax framework that foreign investors need to plan around.

A rising destination for semiconductor investment

According to the Spring 2026 forecast from World Semiconductor Trade Statistics (WSTS), global semiconductor sales are expected to reach USD 1.51 trillion in 2026, driven largely by demand for AI infrastructure and memory chips. At the same time, geopolitical tensions, supply chain disruptions and economic nationalism are reshaping how semiconductor value chains are organised globally.

Against this backdrop, Vietnam has emerged as one of the most attractive destinations for electronics manufacturing and semiconductor investment in Asia. Originally known for low-cost electronics assembly, the country is now positioning itself as an alternative semiconductor supply chain hub, drawing on its strategic location, extensive free trade agreement (FTA) network, competitive workforce and growing government support.

Today, Vietnam is a critical manufacturing base for global technology leaders including Samsung, Intel, LG, Foxconn, Amkor Technology and Hana Micron. While the country currently specialises in assembly, testing and packaging (ATP), recent investments in integrated circuit (IC) design, advanced packaging, semiconductor materials and wafer fabrication indicate a gradual transition towards higher value-added activities.

Electronics exports as the foundation for semiconductor growth

Vietnam’s semiconductor ambitions are built on the strength of its electronics manufacturing sector, which has become the country’s largest export industry and one of the most important contributors to economic growth.

In 2025, Vietnam’s exports of computers, electronic products and components reached approximately USD 107.7 billion. When combined with exports of telephones and related components, total electronics exports reached more than USD 164.4 billion. Exports remained strong into 2026. In the first eight months of 2026, exports of computers, electronic products and components reached nearly USD 101 billion, with telephones and related components adding a further USD 45.6 billion, taking total electronics exports to USD 146.6 billion, according to Vietnam Customs.

According to BW Industrial, a leading developer of logistics and industrial property for lease in Vietnam, high-value-added industries account for nearly half of its total ready-built factory (RBF) leased area, with the electronics sector representing the biggest tenant group. The company also continues to see strong leasing demand from global manufacturers expanding or diversifying their operations into Vietnam.

How Vietnam’s semiconductor industry has developed

Vietnam’s semiconductor industry remains relatively young but has developed rapidly over the past two decades.

The dawn of the industry (2000s)

The industry’s modern development began in 2006 when Intel invested more than USD 1 billion in its assembly and testing facility in Ho Chi Minh City. This investment firmly established Vietnam within the back-end segment of the semiconductor value chain.

The growth era (2010-2023)

With an already large electronics presence in Vietnam, global manufacturers such as Samsung, Hana Micron and Amkor invested billions in sophisticated ATP plants. Meanwhile, domestic corporations expanded their role. FPT Semiconductor launched its first “Make in Vietnam” power management chips in 2022, and Viettel had developed its own 5G chips by 2023.

Ecosystem expansion and government support (2024-2026)

The Vietnamese government set out its ambitions in Decision No. 1018/QĐ-TTg in 2024, aiming for annual semiconductor industry revenue of USD 100 billion by 2050. The strategy is built around the formula “C = SET + 1” (C for chips, S for specialised, E for electronics, T for talent and +1 for Vietnam as a new and safe destination in the global supply chain). In March 2025, the country approved its first front-end wafer fabrication plant, a USD 500 million project aiming to transition Vietnam from back-end operations towards full-stack semiconductor production.

The Law on Digital Technology Industry took full effect, introducing significant tax incentives and research and development (R&D) support. FPT established the first entirely Vietnamese-owned advanced packaging factory, and in January 2026 Viettel broke ground on the nation’s first semiconductor chip fabrication plant at Hoa Lac Hi-Tech Park.

In 2026, the Vietnam National Multi-Project Wafer Coordination Centre (VNMPWCC) became operational in Hanoi to bridge domestic chip design with global manufacturing. The centre provides design tools, verification support and trial production coordination alongside direct access to manufacturing and packaging partners including Intel, Infineon, TSMC, GlobalFoundries, Amkor, Cadence and Synopsys.

Looking ahead (2030-2040)

By 2040, Vietnam aims to become a crucial player in the global semiconductor ecosystem, encompassing all aspects of the industry, from design and manufacturing to ATP and equipment fabrication.

Moving up the value chain

Vietnam’s long-term semiconductor strategy is centred on moving beyond assembly and packaging towards higher-value activities including IC design, advanced packaging, materials and eventually fabrication.

Key targets under Decision No. 1018/QĐ-TTg include:

• Expansion to at least 100 semiconductor design companies by 2030 and 300 by 2050
• Development of 10 packaging and testing facilities by 2030 and 20 by 2050
• Construction of one small-scale fabrication plant by 2030 and three by 2050
• Training of 50,000 semiconductor engineers by 2030

Domestic technology firms are beginning to play a larger role in this transformation.

• FPT Semiconductor designs and develops integrated circuits for applications in IoT, automotive and consumer electronics, and partners with local ATP providers for packaging.
• Viettel High Tech is expanding its chip R&D and small-scale packaging and testing capabilities to support defence, telecom and smart device applications.
• CMC Corporation is entering the semiconductor value chain through IC design services and exploring collaborations with domestic and overseas ATP facilities.

The March 2025 approval of Vietnam’s first wafer fabrication project is the clearest sign of this shift. While modest compared to leading global fabs, the project represents an important strategic shift from pure back-end manufacturing towards participation in front-end production.

Vietnam’s competitive position in Southeast Asia

Traditionally anchored in commodities and export-oriented manufacturing, Southeast Asian countries are starting to align more closely with the global AI investment cycle, primarily by deepening their involvement in higher value-added areas such as infrastructure, hardware and complementary supply chains. The table below compares Vietnam’s electronics and semiconductor profile with Malaysia, Thailand and Singapore.

Sourcing and supply chain ecosystem

For many years, Vietnamese electronics enterprises have participated in global supply chains largely on the strength of cost advantages and order fulfilment capacity. Building on its established ATP base, Vietnam is gradually moving towards higher-value segments, including IC design and localised fabrication. The table below shows where each stage of the value chain stands today.

Supply chain integration and local sourcing

The baseline component supply chain is well established at the tier-1 distribution layer. Major global electronic component distributors (e.g. Arrow Electronics, Future Electronics) maintain local offices in Vietnam, supporting a steady supply of components for local electronic manufacturing services (EMS) providers.

Regulatory and compliance framework for semiconductor manufacturers

Electronics and semiconductor manufacturers in Vietnam operate under a compliance framework covering trade, chemicals, environmental performance, capital equipment and labour. Several of these requirements have been introduced or tightened since 2025.

Trade compliance and deep localisation

Manufacturers exporting from Vietnam face closer scrutiny of product origin and intellectual property.

• Rules of origin enforcement: To maintain preferential tariff access under major FTAs, such as the EU-Vietnam Free Trade Agreement (EVFTA), and reduce transhipment risk in Western export markets, manufacturers face stringent regional value content (RVC) targets of 40% to 60%, depending on the product.
• State digitalisation: The government has deployed an upgraded Electronic Certificate of Origin system (eCoSys) using instant-verification QR codes. Domestic self-certification frameworks have also been codified, significantly increasing financial and legal penalties for origin fraud.
• Intellectual property (IP) protection: Vietnam committed to IP protection amid a US Section 301 probe.

Chemical, environmental and ESG mandates

The Law on Chemicals No. 69/2025/QH15, effective 1 January 2026, overhauls the chemical lifecycle and aligns factory operations with international GHS standards. Among other requirements, it mandates:

• Single-shipment import/export licences for controlled substances
• Five-year production licence renewals
• Certified chemical safety personnel on the factory floor
• Mandatory public hazard disclosures

On the environmental side, under the Law on Environmental Protection No. 72/2020/QH14, as amended by Law No. 146/2025/QH15, semiconductor facilities are subject to strict environmental impact assessments (EIAs) regarding water and energy consumption. Vietnam has also begun piloting greenhouse gas (GHG) emission quotas. These currently apply only to thermal power, steel and cement facilities, but the government intends to expand coverage over time.

Capital equipment and workforce controls

Circular No. 30/2025/TT-BKHCN governs used machinery imports. To accelerate semiconductor manufacturing, the import age limit for used semiconductor machinery has been extended to 20 years. However, production lines must operate at no less than 85% of original design capacity while meeting strict environmental, safety and energy efficiency benchmarks, to prevent the import of obsolete technology.

On the workforce side, Decree No. 337/2025/ND-CP, effective 1 January 2026, sets out the legal framework for electronic labour contracts. From 1 July 2026, contracts signed electronically must be executed through an eContract service provider and connected to the National Electronic Labour Contract Platform (NELCP). Paper-based contracts remain valid.

Tax incentives for semiconductor and digital technology projects

Semiconductor R&D, design, production, packaging and testing, as well as AI data centre construction, qualify for the top incentive tier, while other digital technology products receive a separate set of incentives:

• Standard top-tier incentives: A preferential 10% corporate income tax (CIT) rate for 15 years, with up to four years of full CIT exemption followed by up to nine years of 50% CIT reduction, plus exemption of import duties on goods imported to form fixed assets
• Additional top-tier benefits: CIT rates as low as 5% for qualifying large-scale projects, along with priority customs procedures offering faster processing and simplified documentation, regardless of project scale
• Other digital technology products: A 17% CIT rate for 10 years, with up to two years of CIT exemption followed by up to four years of 50% reduction, plus fixed-asset import duty exemption

Conclusion

Vietnam’s electronics and semiconductor sector is built on a large, established electronics export base, with ATP operations anchoring its current position in the value chain. Government strategy, new incentives and early investments in IC design, advanced packaging and wafer fabrication point to a gradual move into higher-value activities.

For investors, the opportunity sits alongside a tightening compliance environment covering rules of origin, chemical management, environmental performance and new rules on electronic labour contracts. Understanding which incentive tier applies, and which permits and certifications a project needs before capital is committed, can make entry into the sector considerably more predictable. For a wider view of how electronics fits into Vietnam’s manufacturing base, including FDI trends and the regulatory reforms shaping investment, download Acclime’s industry report Vietnam’s next manufacturing frontier (2026).

How Acclime can help with semiconductor investment in Vietnam

Acclime advises electronics and semiconductor investors from initial setup through ongoing operations in Vietnam. We handle entity structuring and investment registration, incentive classification and application, export processing enterprise and customs treatment, chemical and environmental permitting, employment compliance and origin documentation. We help investors resolve these matters early, before capital is committed and while decisions are still inexpensive to change. Contact us to discuss your project and the next steps for setting up in Vietnam.